Challenges Facing the Use of Electronic Fiscal Devices for Tax Reporting in Zanzibar

Abstract

The study aims to identify the challenges facing the use of Electronic Fiscal Devices (EFDs) for tax reporting. The study applied a descriptive research design where primary data was used with a quantitative research approach. The sample size of the study was 98 taxpayers obtained using Yamane’s formula. SPSS v.26 was used to analyse the data. Results revealed that the challenges facing the use of EFDs for tax reporting include network problems, lack of trust in the use of EFDs for tax reporting, training were not enough, customers do not have a culture of requesting receipts, high cost of EFDs and EFDs often breakdown and not working. This study recommends that the government should provide more training to taxpayers and educate the public about the importance of tax and claiming receipts, and reduce the price of EFDs to encourage more taxpayers to afford to buy the machine or, if possible, to be given to taxpayers free of charge. Also, the government should provide good infrastructure to solve a slow or no network and provide strong punishment for those taxpayers who do not issue a receipt and for those customers who do not request a receipt